Germany has urged the UK to join the euro as soon as possible, claiming that remaining outside the single currency would damage both its own economy and Europe's as a whole.

In an interview with today's Telegraph, German finance minister, Hans Eichel, said that "economic prospects for Britain would be lower" outside the euro-zone.

Claiming that Britain's "natural eccentricity" would be an obstacle to the EU's ambition to become "the most dynamic economic area in the world", Eichel went on to say that if Britain entered it would have to agree to co-ordinate its tax policies with other EU partners.

Tony Blair was also given a warning that Britain's influence would diminish if it joined the euro late, allowing other nations to set the rules.